MUMBAI: The markets watchdog Sebi has learnt to have lifted the trading ban on Copthall Mauritius Investment, a unit of JP Morgan Chase based in the tax haven, and the city-based Mansi Share & Stock Broking, after they deposited Rs 2.96 crore and Rs 71.6 lakh, respectively, to comply with the regulatory order to disgorge their alleged illicit gains.
A source aware of the development said, however, that the Sebi investigations into the alleged market manipulation on August 13 on the Sensex, will continue, even though they can resume trading in the market.
“While the trading ban on both the entities is lifted, Sebi’s investigations into the alleged market manipulation will continue,” a source told TNIE Wednesday.
The source further said Sebi will shortly release a confirmatory order after studying the formal responses of the brokerages. The Sebi had given both the companies 21 days to respond.
On August 20, two weeks into the closing auction session (CAS) driven price discovery framework was rolled out from August 3, which is still leading to wild fluctuations in both stock prices and closing indices levels, Sebi through an interim order, banned Copthall and Mansi from the market and also ordered them to pay back Rs 2.96 crore and Rs 71.6 lakh, respectively, as part of disgorging their illicit gains.
The alleged manipulation was on the BSE on August 13, which benefited their options positions on the benchmark Sensex, according to the Sebi findings.
Neither Sebi nor Copthall nor Mansi officially offered a comment.
Since the allegations of price manipulations still continue, the Sebi last week had said it would issue a discussion paper shortly on determination of settlement price for futures and options contracts in light of the new mechanism. But has firmly ruled out rolling back CAS, which it believes over time help investors arrive at more transparent prices.
Copthall was a big player in the domestic market earlier owning over Rs 5,500 crore worth of stocks, over the years it has scaled down its exposure to under Rs 38 crore as of end June. It is separate from JP Morgan India which is registered with Sebi as a separate stock broker and merchant banker.